New Study Finds California Would Save $37 Billion Under a State-Run, Single-Payer Health Plan

According to a new study from the University of Massachusetts, California could save up to $37.5 billion by eliminating private health insurance and switching to a state-run single-payer health plan. The study also states California could save the money even by adding the nearly three million residents who currently do not have a health insurance policy.

However, the favorable findings were commissioned by the California Nurses Association, which is the lead sponsor of a bill that would replace private health insurance in the state. The findings also came a week after a state Senate committee reported it would cost the state $400 billion annually to run a single-payer program. The funds to run the state-sponsored program would more than likely come from an increased payroll tax of 15 percent.

Economists at the University of Massachusetts reached a different conclusion regarding the $400 billion cost. The economists reported that California would save billions by eliminating the overhead associated with privately-held health insurance companies. Other savings would come from controlling the costs of prescription drugs while saving money for those covered under the state-run program.

According to the University, it would cost California $331 billion to provide universal health care to every resident of the state. The university's estimates show it would cost less than the current $368.5 billion the state spends on health care, which leaves millions of residents uninsured. The estimates also conclude the state needs to find an additional $106 billion to help fund the universal health care system as opposed to the Senate committee's estimate of $200 billion.

Proponents of the measure to provide universal healthcare in California conclude that residents would receive far more coverage for less out-of-pocket costs. According to a poll conducted by Tulchin Research, 70 percent of California residents support a universal healthcare system in the state. However, the California Nurses Association hired Tulchin Research to conduct the poll.




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